>> all right. welcome back to "fox & friends." coming up tomorrow on the show all eyes on the fiscal cliff so we've got chris wallace because he's watching everything coming out of washington and we'll keep you up-to-date on the changes. >> dave: right, 'cause the senate should convene at one o'clock and the house is get to convene. we'll get some leaking details of some sort of plan. >> juliet: and celebrity meltdowns, the top ones. did clayton make the list? should this one make the list? >> days left and maybe i can meltdown. >> dave: join us on the after the show show.

>> they're still scrambling and we're all still waiting. wh but would no deal be better for the fiscal economy than a rushed deal. brenda buttner, bulls and bears. gary b smith, tobin smith. jonas max ferris. a no deal better than a bad deal. >> it would create more uncertainty or one of the deals they're talking about, which is raising taxes and now, and they trust us, we'll get to the spending cuts later on, let's not worry about that right now. the last thing we want to see is a weak-need congress and a weak-willed president patting themselves on the back because they have some watered down deal. i think they need to feel some pain, i think they need to see he the implications in the markets, in the economy, so,

yes, i think no deal right now is better than a bad deal. >> okay, gary b, jim mentioned the market, let me play wall street on tv. basically i'm sick of this. i'm going to keep heading south because the uncertainty, the anxiety is killing me. if we had any kind of deal, at least we might see stocks move up a bit. that would be good for our 401(k)'s, wouldn't it? >> that's exactly my perspective, brenda. this was a really rough week on the market and it's all related to, not the-- not the fiscal cliff, it's the psychology of the fiscal cliff, and the sad truth is whether they do a deal now or they thoughtfully do a deal six months from now, really, nothing will be accomplished. the fact is, public debt is consuming our economy. it's about 73%, regardless of what deal gets done. it will be about 73, 74% ten years from now. we've done nothing and nothing will be done to address social security, which is now

officially running a deficit, medicare, medicaid costs are growing ast nomically. at least do a dumb deal now and get people over the fiscal cliff and kick the can down the road, that's going to happen anyway. >> steve, no deal, bad deal? i kind of feel like i'm playing poker. what do you think? >> i can't believe it, but i agree with jim. the most deficit reduction is going to come from no deal. and that's what we need. that's what this economy needs, the biggest threat to economic growth, if the deficit and the debt, 4 trillion, everybody talks about it as some sort of grand bargain. it's barely a start. this isn't a fiscal cliff, it's a fiscal bunny hill, let's slide down it. >> if we slide down, jonas, in the first week, people are going to open up the paycheck and see less money there. i don't think that people understand that at this point. >> people get used to tax cuts, that's the problem.

short-term expiring tax cuts, including the payroll tax cut. you know, it's not the best way to solve a problem, but this cliff is the result of not coming up with deals and they're not going to come up with battery deal, if it's negotiated it's not the ideal way to solve it out after deficit. we'd like to gradually raise taxes and cut spending, but this is the best we're going to get. any of the deals they would agree on, probably leave us to the other guest's point, close to a trillion dollars anyway, and it's the closest shot leaves us with a deficit and closing this gap we can't get out of. and since they lowered taxes they raise spending and two things have to convening and one unfortunate way to do it. >> aren't we in the end, toby, go to get a bad deal? >> from the market standpoint we want to this riding in the last moment on white horses kumbayah, i believe the last hour the last day. >> the markets have been down

had a bad week, selloff. >> in the futures market on friday, just after the guys came outen said maybe we have a deal, shot up a hundred points, but the market is a short-term player. the short-term there's a vote counter, it's voting short-term. in the long-term, gary b is absolutely right and other guys are right, we'll get over this. don't worry about your 401(k) on january 3rd if it's down because we don't have a deal. worry about your 401(k) two years down the road if not only we get nothing, but now we go into a place where, i mean, our country is more divided according to a lot of reports than we were the civil war in terms of where we are. if we need to get closer on that long-term deficit, people will a fiery leap and then see your stock market race and roar. >> i don't know. jim, what do you think? the market is pretty short-term and toby says take a longer term perspective. is that what we need? >> i think that the market

gyrations are not what we need to really worry about. we really need to address what's going on with our debt and keep in mind the federal reserve board is printing about a trillion dollars a year right now. why are they doing that? so happens we're running a trillion dollar deficit. we have got to get control about it. they ought to forget about the stock market now and address the deficits and simplify the tax code so we can get the economy growing, that would create more revenues. they're not going to do it. i'm just wishing and dreaming. >> gary b, you can wish, i know you've been quite skeptical and skepticism seems the proper attitude given what history has shown us what washington can do. >> exactly, brenda. one of the reasons that jim alluded to, he said, look, we don't need to pay attention to the market. well, we need to pay attention to the psychology though. the market is one manifestcation of that, but it works in other things like retail spending over the holidays. people just fear this fiscal cliff thing and they get scared and they tighten in and

they don't spend as much, i think you're going to see that when the final retail results come out from this past holiday season. that's why i want something resolved. even if there's a big headline in the washington post, it's fiscal cliff resolved and nothing got done, people would feel better about things. >> toby, speak to that point. you don't think so, huh? >> was that the pablem strategy, gary? >> that's what we're going to get anyway. >> six months ago we passed on the horrible sequestration things so congress can have time and solve this, where did it get us? nowhere. and there's a reason people don't trust this congress, they haven't earned one eye o iota. >> and got their vacations. >> let's talk the economy. the economy is right on that precipice. if we were to just take a shot into, you know, the back side

here, you know, our consumer confidence has been dropping week by week and we'll get right back into slow growth and then we'll freak out and do something more stupid. >> you were smirking, jonas. >> to get to your original question of the stock market, i think if they did nothing, but kick the can an entire year with all of these things and pushed the whole thing the next holiday season and holiday sales like this year, i think the market would go up, wall street is happy with pushing the problem down the road even though it should be addressed sooner than that. i don't think it's good for the stock market in the short run to solve these deficit problems. maybe we can keep rates 0 low and basically get money or nothing basically. >> steve? >> this is absolutely right. everybody thinks that 4 trillion dollars is going to wreck the economy somehow. these cuts are very small in terms of the overall size of the economy. plus, people lack confidence in ever having any sound fiscal policy in washington.

the stock market will do best by us putting in place some much more conservative fiscal policies. >> okay. >> wait a minute, steve, is that you? is that you? (laughter) >> we can find common ground. we can find common ground. >> there's the kumbayah, okay, thanks, guys. well, forget all the talk in d.c. permanent tax hikes will definitely hit on tuesday no matter what. the cavuto gang getting ready to tell you what the government is ntelling you. that's at the bottom of the hour, first, angry passengers stranded in airports cursing the weather. but should they be cursing government regulations instead?

>> from america's news headquarters, i'm heather childers. it's down to the wire for a fiscal cliff deal. senate leaders from both sides of the aisle vowing to scramble days before a new year's deadline to reach a plan or watch the economy go off a cliff. president obama says he's optimistic that they'll come to an agreement that will avoid across the board tax hikes and deep spending cuts. and here we go again, more snow headed to the the northeast, where a major winter storm already dumped several inches on inland areas. snarling roads, canceling hundreds of holiday flights. two powerful systems expect today come up the east coast by today, from south carolina

to new york already issues severe weather warnings. i'm heather childers, now back to bulls and bears and for your latest weather headlines, log on to foxnews.com. you're watching the most powerful name in news. >> canceled, that's what thousands of ticked off holiday travelers are seeing on airport monitors this week. and while the nasty weather is to be blamed, toby says we should blame government regulations. >> here is a fact when it's a $27,000 fine if you're on the tarmac for more than three he hours in a minute which i was about two and a half years ago before they did this, what happens is, they get fined $27 grand per passenger and now they're doing, what they call in the industry the economic kill and look at the numbers and amount of passengers on the flight and for the idea of maybe saving 100 or 200 people a year, who are stuck on the

tore ma tarmac and trust me, it's no fun. 2 million people have flights canceled next year because of the quick kill. and as long as we have a $27,000 fine they can take the profit from the airline in a month in one plane flight. so they're not doing this. >> brenda: let's kick this to the extreme. the fine is $27,000 per passenger, if you take that to the extreme, it might illustrate what this is about. >> let's pretend it's a 100 million dollar flight obviously an airline is not going to fly a plane if there's a chance it's going to be on the tarmac more than three hours. when you do that, you see at the margin there's flights that get caught. wouldn't have been caught back when they could leave tobin on the tarmac with no water and-- >> forget that, no cocktail. >> the result you can have more likelihood of your flight getting canceled. on the flip side not getting stuck on the tarmac for six hours, some people think it's a good thing.

and if your flight is canceled you're not going to get home and you're mad. >> brenda: gary b. >> and versus hundreds of thousands, how can you have a trade-off? >> guys, we were looking at a graphic, gary b, showed the year before the regulations how many canceled flights and the year after, how many cancelled flights and there's a big difference there. >> toby is kind of right. whenever the government int intercedes and tries to fix the market. back in 1978 they deregulated the airline industries, you had airlines come and go and some failed and some rightly so, but you look at the-- for example, ups. if you go in and you choose two day delivery at ups and they screw up a couple of times, guess what, you start using fed ex and maybe even the postal service for crying out loud. with airlines, people, yeah, you might get stuck on the tarmac for eight hours and

people are blogging and twittering like crazy and whatever airline did that more than a few times, toby wouldn't fly delta, fly american or take the train or something. let the market work, the government can't manage it. >> brenda: what do you think, does the invisible hand of the market work or does the government need to reach in as well. >> and what i think is that gary b and tobin can go ahead and die a slow death sitting on the tarmac, i'm for the fast death, and not having the airlines leave people parked on the tarmac and also, look, we have two huge storms, one behind the other, covering two-thirds of the country and the government gets blamed by these guys for it. come on, guys, it's bad weather. >> brenda: oh, well, we can blame the government, there's plenty to blame around there. >> blame them for the debt. >> brenda: and it's kind of hard to pick a side here, right? you sit on the tarmac or you get your flight canceled or you sit in the terminal? >> well, brenda, i'm against all government regulations and

i'm also against the cattle call customer service that we always get from the airlines. so, picking a side here is like edie amine and paul potts, at the end of the day, i really think that government needs to stay out of this, and customers can vote with their feet or wings, hot air balloon, take a train, whatever they want to or switch airlines. i don't think it's really worth it for the government to get involved here and as we found out, with banking regulations, the fees will go up. the fees will always go up the more that the government gets involved in any industry. so, whether it's baggage fees or some other kinds of fees that we're seeing, we're going to see fees go up because the government intrusion here. >> brenda: toby you probably spent more time on the tarmac or in an airport than anybody else, you have the final word. >> we recently had a flight come back, on the tarmac for two and a half hours and it came back and those people off loaded, and my group of people got on the same flight and

took off in a half hour. that's the insanity that we're in right now because of these laws and it's the unintended consequences as gary says, taking a few incidents and now taking 2 million people to deal with a little problem. >> brenda: thanks, guys, that's got to be the last word. so, dock workers and shippers forging a temporary deal to avoid shutting down major ports and our economy. sounds like good news. why is someone here still seeing a ship wreck ahead?

>> coming up. the port strike may have been averted for about a month, but someone here is saying it's not smooth sailing for the economy just yet. plus, the gang

>> a last minute deal averts a crippling strike from maine

to texas, but the temporary agreement will only last about a month and jim, you say this could be the costliest union threat yet? how so? >> we've already seen retailers like home depot, lowe's and target affect their business. we're in an age of just-in-time delivery. and when you disrupt that, you disrupt things when times are tough. bear in mind, also, there are 25 million people out of work. 52 million on food stamps and the unions are choosing now to flex their muscles. i don't know who is running pr for these people, it might be "monty python," it's bad timing and bad pr. >> brenda: and these people say they need a better, livable wage. yeah, what's wrong with workers getting a raise and wages going up overall in the economy? that's going to give people more confidence. >> brenda: right. >> it's a good, a little wage inflation would be good for this economy. >> brenda: jonas, are we going to see inflation after different sort? are we going to see inflation to the products and to the

owners too? >> by t vchlimport-- there will be increase ins prices. in this case, the union screwed up in the sense they should have done this during the holiday shipping season and kind of missed that strike opportunity like they had a few years ago and now the shipping volumes are lower so we can kind of handle it, tax increases are going to happen and it will drop off. unions have no power in in and it will fizzle out because of that. >> brenda: what do you think, gary b, a bigger threat because that have? >> no, i think it's a minimal threat. i think it's the right tactic, it's the wrong decade for it. look, you're target, now you know, in 30 days, our supply could be disrupted, what are you going to do if you're the target guy head of inventory? you're going to say maybe we'd better order a little bit more right now so we have supplies. they're not going to let their shelves go empty or they're going to say look, we won't use cargo ships, we'll bring

it over by air freight. for crying out loud they're going to adapt. the unions missed the boat on this one, so to speak. >> brenda: but there's a price to that contingency plan, last word? >> yeah, there is. for the president to add another 80 days on to this, but let's miss the point, striking because automation is taking their jobs. they should talk to the gas lamp lighting union. >> brenda: that's got to be the last word. okay, thank you guys. and thanks to steve and jim for joining us today. we appreciate it. up next, the gang is on the hot seat their best and yes, worst calls in 2012 and see how you can still profit from the good, bad and ugly. put down the noise makers and pick up moneymakers, it's a new years party, bulls and bears style. the one stock that could double your money in 2013. i knew it'd be tough on our retirement savings, especially in this economy. but with three kids, being home more really helped. man: so we went to fidelity.

we talked about where we were and what we could do. we changed our plan and did something about our economy. now we know where to go for help if things change again. call or come in today to take control of your personal economy. get free one-on-one help from america's retirement leader.

>> okay fair and balanced, that's the the way we make money here, our gang's best and worst calls in 2012 and how you can still profit from them. right now in the scoreboard. so we do the bad and good here on bulls and bears and saving the best for last and starting with the best of the worst or , you're up ke that. first in march you said get healthy with molina health care, but making investors sick with a 20% drop. will it recover? >> they had a bad quarter, but medicaid and obamacare is it going to help them. i am a buyer now. >> brenda: jonas zumiez was

your pick and 49%, are you still standing by that call? >> 49, you know, last year worst pick sprint went up 140% this year. stick with it it could rebound next year. >> oh, man-up. >> brenda: and worst call in 2012. gary b, in may you said nike would run to new highs instead it tripped and fell and it's down 53% since then. are you still a believer in nike? >> i am, it's rallied lately and made a nice move, the last few weeks. i love it for 2013. >> brenda: okay now to the best calls and toby, you're going to kick things off again. in august, said build up your profits with pulte group since then up 41%, time to buy more or take the profit and run. >> it's going to be up another 20, 30%, i might sell half and hold onto the rest. >> brenda: on to number two, jonas, back in march you said pour yourself profits with constellation brands and 54% gains since then.

you still like that? >> i would sell that to cover your losses in zumiez. >> brenda: he did man up. and there for the number one call in 2012, gary b, you have the worst and the best in january you said bank of america was ready to bank some serious profits. well, boy, you were right in percentage terms, it's 73% higher, cash out or buy some more. >> no, no, it's going to keep going higher. too big to fail, brenda, the nice thing about this. >> brenda: i never thought i'd hear you say that. and all right, guys, that was then and this is now, it's time for the best name to own in 2013. gary b, your prediction? >> well, i hesitate to go back to the well again, i'll go back with apple, slaughtered recently down 26% if highs, i think it will make new all time highs. >> brenda: jonas bull or bear. >> not quite as bullish, but yes. >> brenda: tobin, your prediction? >> blackberry has got the